No one writes about Middlesbrough like Richard Milward – then again, no one else writes about Middlesbrough, which at least gives him the advantage of having the field to himself. His debut, Apples, was written when he was 19 (he's only 28 now) and featured a group of teenage mums living on a diet of Smirnoff and acid. The follow-up, Ten Storey Love Song, offered its own recipe for the ingestion of hallucinogens: "Two crushed ecstasy pills, one slice of toast (butter optional)."

On the face of things, Kimberly's Capital Punishment seems to mark a departure. Though the principal characters come from the north-east, the action is set in London; and whereas the first two were lean, hungry pieces of work, this takes the form of a sprawling surrealist epic with six alternative endings.

Whatever Milward's vices and virtues (which tend to be inseparable) he certainly knows how to write an arresting opening sentence: "I found the eyeball 15 minutes before I found the rest of him." The eyeball in question belongs to Kimberly's timid, stuttering boyfriend Stevie, whom she discovers hanging by his shoelaces in a Tottenham playground. Kimberly (whose caretaker father named her after the manufacturer of hand-towel dispensers) feels guilty for Stevie's demise, having been intentionally rotten to him in recent months as a means of dumping him. So she resolves to atone with a series of random acts of kindness, which include bestowing sexual favours on a boy with Down's syndrome, and handing over her modest inheritance to a pair of unreliable accomplices named Shaun and Sean who blow the lot with a bet on Middlesbrough FC.

The trouble with basing a plot on random acts of kindness is that anything can – and generally does – happen. Milward seems less preoccupied with maintaining a coherent narrative than treating every page as a different stylistic experiment. The reader is bombarded with cutups, acrostics and blank pages, while Shaun and Sean are rendered in parallel columns for which Milward offers the following advice: "To read this section, remove your eyeballs and let them roll down the page simultaneously."

Things become truly bizarre when Kimberly is mown down by a Ford Mondeo and finds herself having a game of Subbuteo with the grim reaper. At this point the reader is invited to throw a dice (or, Milward suggests, extract and individually number six of your teeth) to determine what is going to happen next. One option is that Kimberly goes to heaven and is pleased to be granted an unlimited store account at the heavenly branch of Topshop; another is that she is resurrected and put on trial for the murder of her boyfriend by a jury of 12 giant vaginas.

While you might legitimately protest that you couldn't make this stuff up, that would seem to be Milward's point. The main evidence against Kimberly at her trial is her appearance in a work of fiction entitled Kimberly's Capital Punishment. The defence counsel states: "I believe she's the victim of a cruel plot. A plot envisioned by one Richard Milward involving sexually aggressive seals, a heavy-drinking grim reaper, a cack-handed reader and, dare I say it, a jury of genitals."

It ultimately comes down to a matter of taste – though even Milward's fans may begin to wonder if 400-odd pages of off-kilter improvisation might be a little too much of a good thing. Yet the greatest drain on the novel's credibility is not the lysergic outbreaks so much as the metropolitan setting. Milward appears to admit as much himself: "Many people come to the capital to 'find themselves', but in fact the capital steals your identity, over time – first it messes with your dress sense, then it softens your accent, then it sours your sense of humour, then, before you know it, your whole personality's been pulverised."

The first two novels had their erratic moments, but were firmly grounded in a sense of place that made their fanciful escapism feel doggedly real. Somewhere on the move south the raw individualism seems to have been misplaced, leaving an empty bag of tricks and techniques.